In terms of underwriting profit, he said the p-c combined ratio was 93.4 in the quarter–98 for domestic business, and 81.6 for foreign business.

Noting that loss reserves increased just over $2 billion to $49.8 billion in the first quarter, Mr. Sullivan later gave an anticipatory response to a question he knew was on the minds of investors–the question of when the previously announced reserve review would be performed.

Mr. Sullivan said that proposals from several outside actuarial firms were currently under consideration and that AIG expected to make a decision very soon, and to initiate the review shortly thereafter.

He also said work that needs to be done to address material weaknesses in financial controls disclosed earlier this year is under way. Calling it a top priority, he said AIG's chief risk officer, Robert Lewis, is leading the initiative and working alongside AIG's independent auditors to address those issues.

AIG, which is being sued for accounting fraud by the New York Attorney General's Office, has admitted to improperly documenting transactions.

Mr. Sullivan also said that AIG expects to file its second-quarter results on time, no later than Aug. 10.

Confirming some negative news, Mr. Sullivan reiterated a prior report that on the domestic life and retirement services side of the business, "certain producers are more cautious" in light of regulatory probes and negative publicity.

Asked more directly about the impact of ratings downgrades on AIG's business, Mr. Sullivan said that for general insurance (property-casualty) business, "there was generally little to no impact whatsoever."

However, "honestly, as we've disclosed, in the capital markets area, the overall loss of triple-A credit rating has impacted our ability to trade in certain transactions," he said, referring to the financial products segment of the business. (AIG Financial Products operates in derivatives markets–including the equity, fixed income, foreign exchange, energy, metals, commodities and credit markets, according to information about the unit on AIG's Web site.)

Detailing what they have seen, AIG management said that during the first quarter, although customers wouldn't call and say, "We're not dealing with you" for capital markets transactions, the company did notice that some business it thought it usually would have won had gone to other insurers at levels as competitive as AIG's. The company did not quantify how much of this financial products business was involved.

Now that all rating agencies, with the exception of Fitch, have taken AIG's ratings off credit watch, management said it was finding when it met with clients around the globe they are comfortable that "the knife has stopped falling" and they expect the financial products business to come back to AIG over time.

During the conference call, Mr. Sullivan confirmed that AIG did recently lose one foreign life insurance executive, but that he had no other major executive defections to report.